FCPA INVESTIGATION AND ENFORCEMENT TRENDS

After a number of fallow years, it appears that 2016 saw a return to more active FCPA enforcement. This trend may continue as we move into 2017, though recent political developments in the US may curtail enforcement activity moving forward.

The Department of Justice (DoJ) previously claimed it is working on making FCPA prosecutions more transparent, and it is going after ‘high impact’ cases. Only time will tell, however, if new US president Donald Trump shares this enthusiasm for enforcement activity.

Up to the end of October, 2016 saw 39 FCPA enforcement actions resolved. If that level is maintained to the end of the year, there will have been in excess of 48 dispositions (compared to the record of 72 set in 2010). Dispositions in 2016 were the result of a significant increase in standalone FCPA enforcement actions brought by the SEC. By November, the SEC had resolved twice as many FCPA enforcement actions than the DOJ.

Yates Memo

One of the most eye catching elements of the DoJ’s recent enforcement activity has been the so-called Yates Memo, otherwise known as the DoJ’s Individual Accountability Policy, which focuses primarily on individual liability for alleged corporate wrongdoing. The Yates Memo identified six key measures prosecutors should take when investigating corporate malfeasance. The most significant of these stipulates that companies must furnish the DoJ with all relevant facts relating to the individuals responsible for the corporate misconduct in order to qualify for any cooperation credit. According to the DoJ, companies can qualify for a cooperation credit even if they are “unable to identify the culpable individuals following an appropriately tailored and thorough investigation”, as long as the company “provides the government with the facts and otherwise assists [the government] in obtaining evidence”.